The present invention relates generally to investment transaction structures and, more particularly, to investment transaction structures in which one party may substitute one investment for another.
Investors often seek to hedge their investment risks. Hedging is an investment strategy designed to reduce investment risk by reducing the volatility of an investment portfolio by reducing the risk of loss. For example, when an investor has a “long” position in a stock, e.g., due to physical ownership of the stock, the investor may hedge the risk by simultaneously using call options, put options, short-selling, or futures contracts. Such a hedge can help lock in profits.